Bally’s pauses non-gaming construction in Chicago in response to VGT dilemma

The construction timeline for Bally’s $1.7 billion permanent Chicago casino has taken yet another turn, as the company announced over the weekend that it is “resetting the pace of construction” of certain project elements in response to the city’s legalisation of video gambling terminals.

On Saturday, the company notified the Chicago Community Builders Collective, the general contractor overseeing the project, that construction of certain non-gaming elements will stop for the time being. This includes the hotel tower, event center and restaurants. The company reiterated that the opening target for the casino itself is still on track for early 2027, which is in line with its most recent estimates.

In a statement, Bally’s said the “uncontrolled proliferation” of VGTs within city limits violates the company’s Host Community Agreement with the city of Chicago. Several of the commitments outlined in the HCA could be jeopardised by an expansion of gambling within city limits, including a $4 million annual payment.

“We do not take this lightly because of the potential impact on many of the 1,500 union trades people who have been working hard to build Bally’s Chicago,” the statement concluded. “We will continue to assess our options, which we hope will include more productive discussions with the Mayor’s Office and City Council.”

This latest move represents the fourth major construction snafu for Bally’s Chicago, the city’s sole casino licence holder. Work was stopped on two other occasions, once for debris falling into the Chicago River and again when unapproved contractors were pictured at the site, and potential interference with city water lines caused a major hotel redesign before construction even began.

VGTs pose big threat

The legalisation of VGTs in Chicago was the result of a tumultuous budget process last year for Mayor Brandon Johnson. His budget proposal was overruled in favour of a $16.6 billion alternative budget that was muscled through by the City Council. That alternative budget earmarked more than $6 million in VGT licensing revenue, which would translate to over 2,500 licences to local businesses.

The state of Illinois legalised VGTs in 2009, and they first went live in 2012. They have since grown to become the most lucrative gaming vertical in the state — in 2025, the total tax revenue from Illinois’ 17 licensed casinos was $430 million, less than half of VGTs’ total of $1.1 billion. Chicago had been one of the state’s few remaining municipalities without VGTs prior to the budget process.

While the rollout and implementation of the VGT legalisation has been haphazard this year, Bally’s has consistently rallied against them since the budget was passed. One idea has been to install slot machines at Midway and O’Hare airports, which would help counteract the revenue lost to VGTs, but that has not yet been pursued. Bally’s has estimated that the machines could slash $74 million in revenue and hundreds of jobs. A June hearing on VGTs led by the city’s Committee on Workforce and Development was abruptly cut short due to infighting among officials.

In the lead-up to a potential lawsuit against the city over the machines, Bally’s hired Fahner Rosenberg PLLC in June. Former Chicago mayor Lori Lightfoot, who was heavily criticised for selecting Bally’s as the sole Chicago licencee in 2022, is a partner at the firm. In a statement, the company described the hiring as part of its “efforts to protect our investment” in the city.

Licence extension secured earlier this year

While the VGT issue is far from settled, Bally’s did resolve a separate looming issue in Chicago this summer. For the first half of the year, the company was facing a 9 September deadline to open the permanent casino, as its temporary licence was due to expire on that date. If the deadline was not met, Bally’s temporary casino at Medinah Temple would have been forced to close.

An extension bill (HB4437) was filed in January but did not pass before the Illinois legislative session adjourned 1 June. However, the language from the extension bill was included in the state’s 1,600-page omnibus revenue bill (SB3019), which did pass.

When factoring in the time allotted by the extension as well as the time the temporary casino has already operated, Bally’s now has until 9 September 2027 to open the permanent casino. Based on the VGT non-gaming construction dispute, the casino might be the only component open by that time.